Answer:
The correct answer is $134,750 and $19,250.
Explanation:
According to the scenario, computation of the given data are as follows:
We can calculate the price allocated to the poll by using following formula:
Price allocated to the pool = Selling price × fair value ÷ ( Fair value + Installation fees)
= $154,000 × $140,000 ÷ ( $140,000 + $20,000)
= $154,000 × 0.875
= $134,750
Now, We can calculate the price allocated to the installation by using following formula:
Price allocated to the installation = Selling price × Installation fees ÷ ( Fair value + Installation fees)
= $154,000 × $20,000 ÷ ( $140,000 + $20,000)
= $154,000 × 0.125
= $19,250
